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Coke is considering launching a health drink (H) or not (N). This choice is opposed by Schweppes, who can then decide to choose H
Coke is considering launching a health drink (H) or not (N). This choice is opposed by Schweppes, who can then decide to choose H or N itself. The payoffs are 30 to Coke and 40 to Schweppes following (H,H). If the actions were (H, N) the payoffs are 60 to Coke and 30 to Schweppes. If the actions chosen by the two rivals are (N, H) the payoffs are 50 to Coke and 40 to Schweppes. Finally, if the actions are (N, N) the payoffs are 60 to Coke and 50 to Schweppe, respectively. What are the actions taken by Coke and Schweppes, respectively, in the credible (subgame perfect) equilibria? 0 (H,H) There is no credible equilibrium. 0 (N,N) (, ) 0 (N,H)
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